Galliard Homes has rejected suggestions that it misled people over the future of Lanterns Studio Theatre on the Isle Of Dogs.

At a recent Tower Hamlets planning meeting, in which the developers’ ambitious plans for Millharbour Urban Village were deferred, Lanterns owner Janet Viola and Canary Wharf ward councillor Andrew Wood said it came as a shock there would be a price attached to Lanterns’ occupation of the development, a figure they put at around £6million.

But Galliard Homes has said that it kept the studio owner fully informed over the plans and Lanterns’ status within them.

A statement said: “The suggestion that the owner of Lanterns and Cllr Wood had been led to believe that Lanterns would simply move into the new space is disingenuous in the extreme.

“Galliard Homes has maintained an extensive dialogue with Janet Viola going back to 2013 and at no time was there ever any suggestion that the premises were to be provided free of charge.

“The premises included in the development were designed specifically to Janet Viola’s specification including a very expensive 700-seater performance theatre. This was designed into GHL’s scheme at its own cost and formed part of the submission to Tower Hamlets development committee.”

An artist's impression of Millharbour Urban Village

Galliard said it was already providing Lanterns with support through discounted rent in its present home after an initial rent-free period.

“Whilst GHL is happy to support the business in its existing location in this way, Galliard Homes cannot be expected to do so indefinitely.

“At no time was Lanterns told that the business would need to pay £6million for the premises nor that it would need to build the premises itself. GHL have offered Lanterns terms for a new lease on the premises at a commercial rent and negotiations continue.

“Neither the development committee nor the public have been misled. GHL would be delighted to re-house Lanterns in its Millharbour Village Development and has made great efforts and allowances to do so including phasing the development so that Lanterns can remain where they are until the new premises are completed.

“But we cannot be expected to simply give the space away when other similar occupiers have negotiated and agreed commercial terms.

“GHL looks forward to continuing and concluding negotiations for a lease for new premises with Lanterns and to their inclusion into the scheme.”